Kai-Fu Lee, the former head of Google China, has just finished a $180 million fund-raise for Innovation Works, a startup incubator for he founded two years ago.
Innovation Works is an accelerator for early-stage web and tech companies in China. The firm provides advisement, funding and support services to would-be entrepreneurs trying to get their own startups off the ground.
“Our unique ‘incubation-plus-investment’ model has not only produced a pipeline of high-quality projects but also enabled local early-stage startup teams to grow quickly with the help of our 360-degree mentoring services, in effect creating the entrepreneurial academy for Chinese startups,” said Lee in a release.
In mid-2009, Lee announced he was leaving Google after 4 years with the company. The brilliant computer scientist had been involved with Google.cn since its inception and had previously worked at Microsoft and Apple.
At the time Lee exited Google.cn, China’s struggles with the web were gaining prominence in Western media. The country’s censorship and surveillance program, called the Golden Shield Project drew the rancor of outsiders, while citizens did their best to circumvent censorship software and website bans.
Lee chose this tumultuous time to focus on one of China’s greatest strengths: its human capital. He soon announced he would be heading up Innovation Works, a new incubator just for Chinese startups.
Lee has a much deeper understanding of the Chinese entrepreneurial ecosystem than almost anyone else, and he knew the Western incubator model wouldn’t work in China for a number of reasons, which Lee highlighted in a 2009 interview with VentureBeat.
“Y Combinator would have a very hard time making it in China,” Lee said. “It would have a hard time finding the startups and qualified people to fund. It could interview hundreds and find only two.”
However, Innovation Works has seen definite success in its two years of operation. So far, the organization has incubated 34 companies. Nine of those companies have secured additional rounds of funding from third-party venture capital firms.
Investors in the Innovation Works fund run the gamut from multinational corporations to Silicon Valley elites. These entities include Sequoia Capital, Foxconn, SAP, Motorola, Silicon Valley Bank, Ron Conway and former executives from well-known web properties including Google, YouTube and Facebook.
The Innovation Works fund has been co-founded and co-managed by Innovation Works and investor WI Harper Group.
Stay tuned for an exclusive interview with Kai-Fu Lee on his experiences so far and how he sees entrepreneurship playing a role in the future of China’s Internet.